Movistar To Sponsor Yamaha MotoGP Team In 2014?

Submitted by David Emmett on Sat, 2014-01-25 14:01

It looks like Movistar is on the verge of a return to MotoGP. Italian site GPOne.com is reporting that the Spanish telecoms giant is close to signing a deal with Yamaha to sponsor the Japanese factory's MotoGP team of Jorge Lorenzo and Valentino Rossi. According to the report, the sponsorship deal is set to be announced at the first Sepang test, at a press conference to be held there.

Just how accurate this report is remains to be seen, but there are many indications that the deal could happen. Movistar was a major supporter of motorcycle racing in the past, having backed teams at many levels of racing. Movistar sponsored the junior cup competition in Spain run by Alberto Puig, which unearthed the talents of Casey Stoner, Chaz Davies, Leon Camier, Joan Lascorz and many more. Through Puig, they also backed Dani Pedrosa through his years in the 125 and 250 classes. Movistar was also active in the MotoGP class, backing the Suzuki team of Kenny Roberts Jr, and the Gresini Honda squad of Sete Gibernau at the start of the century.

Movistar (and Telefonica, the telecoms giant which owns the Movistar brand) eventually pulled out of racing over a disagreement with Honda and Repsol. When Honda signed Dani Pedrosa, Telefonica had wanted to continue their backing of the Spaniard, having funded his way through the junior classes. Petroleum giant Repsol insisted that if Pedrosa was to be in the factory team, he should be racing in Repsol colors, not in Telefonica colors. Seeing their investment in Pedrosa going to waste, Telefonica pulled out of Grand Prix motorcycle racing altogether.

They have been biding their time for a return, however. Rumors emerged two years ago that Telefonica had been in talks with Yamaha, but had decided against backing the factory after market research indicated limited return on investment. With MotoGP going to South America - a key market for the Spanish telecoms giant - the sponsorship equation may now make more financial sense. At the presentation of the MotoGP in Jakarta earlier this month, Yamaha boss Lin Jarvis told Indonesian blog TMCBlog that more sponsors would be announced before the season started. We shall see at Sepang whether Movistar is among them.

I'm w Firefly - always liked Telefonica livery and would be VERY happy to see their solid presence returning. MotoGP moves into developing markets, the global economy cracks the gas back open, more bikes fill the grids, sponsors old and new liven up the place, regulation changes open previously closed doors, Suzuki and Aprilia pave the way for Kawasaki and maybe more, and.....
WHO ELSE? Castrol would be nice, and Shell/Advance could step up...what of B.P.? There is a rash of British riders this season. Red Bull or Monster stepping up to primary sponsor status/whole bike livery would be good. Where is Pepsi and Coca Cola? Sure liked Camel and Fortuna livery but alas it is a time (nearly Marlboro?) gone by. Nike, Adidas etc. Samsung, Apple! And where are all the Googles, Yahoos and such?
Good news, very much looking fwd to seeing the bike, I found it perplexing that Yamaha was to be w/o a major sponsor.

Somewhere in the back of my mind there is the color blue and the words Movistar and Pons, and they are all connected. Wikipedia confirms that from 1997 through 1999 there was a Movistar Honda Pons team, among its riders Puig, Checa and Barros. The bike looked like this:

I always thought the livery rather boring and uninspiring despite being newer (ergo 'fresher'?) than Repsol. Regardless, I would love to see any big sponsors returning to MotoGP.

As motoshrink mentions above, I find it baffling how Yamaha 'cannot' find a title sponsor. More disturbingly is how little Dorna appears to have done or how little success they have had, to attract new technology sponsors, especially given the high tech nature of the sport. A quick Google search suggests these companies are not sponsoring Formula 1 either (I have no idea really) so perhaps they perceive other marketing to give better returns? It seems to me if Dorna spent more time finding out for why they Google et al appear disinterested in sponsoring motorsport and less changing the rules, MotoGP could be in good enough health to not require the endless changes.

Motorcycle road racing is an exceedingly poor return on investment from a purely marketing and advertising point of view. If it did any good whatsoever, companies would be sponsoring teams. Marketing types aren't complete idiots. They can count. And the return they get for the money they would spend sponsoring a MotoGP or WSBK team is, with almost no exception, better spent elsewhere.

The "outside sponsor" that is just sitting there with a pile of cash, waiting for Dorna to come knocking with some genius marketing plan, is a myth like Puff the Magic Dragon. There are always, always, always better ways to spend your advertising budget. High-ranking executives from Kawasaki have told me so in exactly that many words:

"If we can't use racing to develop the product, it's like buying media (exposure). Now you're competing against buying TV, buying commercials. Being able to develop motorcycles on the track is a critical component as to why we invest in racing."

In other words, if it's just an ad buy, which it is for an outside the industry sponsor, sponsoring a race team makes no sense. Pretty much the only major "outside the industry sponsor" we have in MotoGP are Italian telecom concerns, because motor sports are like oxygen to Italian culture, and energy drink companies that see motorcycles as part of a larger "extreme lifestyle" image.

But it's funny; if you go to Monster's website and click on sponsorship, there's a photo montage of various athletes and activities. Motocross, BMW, skateboard, etc., for its athlete development program. Motorcycle road racing isn't pictured or mentioned on the web page at all.

Looking at racing from an "inside the industry" versus "outside the industry" point of view is fascinating.

Honda sold about 12.5 million motorcycles and ATVs in 2012 worldwide. Depending on region, up to 47 percent of those sales are ATVs and off-road vehicles. So let's be extremely generous and say 10 million of those sales are street motorcycles, including scooters.

Honda spends an estimated $50 million to $80 million annually on its MotoGP program. So, roughly, you could say it costs Honda $4 or $7 per unit to go GP racing, not including any return on PR, marketing, image-building or whatever AT ALL. That's why you need the manufacturers on board.

Also: Laugh about R&D as it relates to racing all you want, but Honda actually breaks out R&D costs for motorcycles in the text of its annual reports. It does not do so for its other product lines. Honda is very, very interested in R&D for its bikes, boasts about its MotoGP success in its annual shareholder reports in the U.S., and wants its shareholders to know both.

And yet when I submitted requests for a breakdown on ROI in terms of marketing and R&D from racing, I was told 'We do not share that kind of information'. I was told by one representative of a factory 'I don't think we even collect those numbers.'

Whilst I agree with you on the outside sponsorship (at the moment, I believe if the sport was being marketed by somebody with a record of success - this is where Dorna has failed utterly, from my perspective) the power of marketing is wildly underestimated. Of those 10 million units Honda shifts, 7.5 million are shipped to various parts of Asia. As anyone with a sizable following on Social Media will tell you, the interest in Indonesia, India, Malaysia, Thailand, etc is massive. Around 15% of my 23,000 Twitter followers are from Indonesia. The place is awash with Rossi rep scooters. If you want to see how significant it is, check the Alexa rankings (a poor proxy, but the best available public proxy for popularity) of Indonesia's TMCBlog, a site run by a few people, against MotorcycleNews.com or CycleWorld.com, two of the largest motorcycle sites on the internet, with massive publishing organizations behind them. TMCBlog.com is not far off the same size.

Both Honda and Yamaha have their Indonesian distributors as sponsors. There is a good reason for this. Honda's 2013 annual report is full of language talking about the importance of Asia as a growth market (as well as South America and, interestingly, parts of Africa). MotoGP is an excellent way to reach those key markets for the factories. In the R&D section of Honda's report, there is much made of environmental impact, but the only racing project to be mentioned was the CR450F Dakar Rallye bike.

I have worked hard to get hard numbers from manufacturers on the relative importance of marketing and R&D. Factory representatives will claim that R&D is of prime importance for them, and the major reason they go racing. Yet when you push them for figures, they go vague, and refuse to give them. Push them harder, and they admit they don't even track the numbers.

The best quote I got from one factory source. 'There are more reasons than just marketing and R&D to go racing.' The reason they go racing is because they love racing. But that's a hard sell to the board.

I agree 100 percent - motorcycle racing is an excellent way to market motorcycles.

Other stuff, not so much.

If we made a list of completely outside of the industry sponsors (and exclude tobacco, since motorsports advertising was kind of forced on that industry) the list over the past three decades is remarkably small. I can think of energy drinks and Pepsi. I'm sure there are others, but not many. Exclude companies based in Spain, and the list would grow exponentially smaller.

I need to correct something from my previous post: In the annual reports from Honda North America, they actually post up R&D figures for car, power production and motorcycle divisions, as well as a separate section of the annual report devoted solely to R&D overall. But for fiscal 2013, Honda R&D on its motorcycle division accounted for ¥66.4 billion, or more than $648 million.

I think the point still remains that Honda is extraordinarily proud of its R&D efforts, and I think it is important to understand how important those efforts are to Honda and its corporate self-image.

And while I'm sure that Asia is still an important market, did you note that in the 2013 annual report, demand in Asia (defined by Honda as Thailand, Indonesia, Malaysia, the Philippines, Vietnam, India, Pakistan and China) actually shrank in 2012? Demand in India and Thailand increased; demand in China, Indonesia and Vietnam decreased.

p.s. I suspect that MotoGP was not mentioned in Honda's 2013 annual report due to the accomplishments of a certain Spanish ham collector ... ;)

... the point I made at the start or this line of thought was that Dorna have done a truly appaling job of selling the worth of investment in sponsoring MotoGP. Nothing you've said changes that.

I disagree with your perception that there are no sponsors with big check books waiting for something to sponsor. That IS the advertizing world. If as you claim compqnies perceive sposoring is a poor return on investment then who but the commercial rights holder shpuld be working tirelessly to change that perception and prove otherwise?

"... there are no sponsors with big check books waiting for something to sponsor ..."

I am saying if you have money and are looking for a purely marketing and advertising return on a media buy, no matter how well motorcycle road racing is marketed, it's still motorcycle road racing, and there is always another sport, entertainer or activity that will do a better job of delivering eyeballs to your logo.

No matter how well someone markets competitive Uzbekistanian clog dancing to me, I won't watch. Jesus, Allah and the Dalai Lama could run their ad agency and I wouldn't watch. My brother is an F1 freak. He has been in the Lotus garage during practice sessions and watched races from their VIP box. And nothing you can do will convince him to watch a MotoGP race.

That's the difficulty of marketing motorcycle road racing from a purely advertising POV.

Note that Aspar just lost an international manufacturing concern as its title sponsor and has picked up instead an energy drink which is a side business for a company that, as best as I can tell, has two small buildings where they import and renovate used cars and Harleys and a hotel.

There is nothing you can do - up to and including nailing me in front of the TV and pinning my eyeballs open - to make me watch golf or tennis or darts. Should anyone ever be foolish enough to elect me to be king of the world, my very first act would be to ban golf. About once a decade, I can be persuaded to watch a soccer match. Or at least part of it. As for F1, I sometimes watch the first laps, and will watch a couple of laps of Monaco and Spa Francorchamps, just for the location. I have no interest in the rest.

Snooker, an incredibly dull game to watch, was turned into a massive sport. Darts - a bunch of fat blokes throwing things at a small board - is huge in the UK, and has become a massive sport in The Netherlands. As a young Englishman growing up in The Netherlands, I used to play the occasional game of darts at home, but my Dutch friends knew nothing about it. Now, Holland is on the verge of becoming a darts powerhouse.

Speed skating is one of the biggest sports in The Netherlands, and is followed by nearly everyone, yet nobody even knows it exists in the UK, and they barely know it exists in the US, despite having some of the best skaters in the world.

In other words, different strokes for different folks. Clever marketing and the right approach can make any sport popular. Any sport at all. Even competitive Uzbeki clog dancing. One of the biggest TV shows in the UK is one about ballroom dancing. Ten years ago, you would have been taken outside and shot if you had suggested to TV executives that they should put on a show about ballroom dancing.

Dorna don't understand that they have dynamite in their hands. Or perhaps they do, but they have been unable to exploit and market it. Given the right people, and the right focus, motorcycle racing could be huge. Whatever your brother thinks.

Is it actually " ... clever marketing and the right approach ..." or is there something else happening here, not the least of which may be a healthy dose of dumb luck? I mean, the TV show "Cops" here was a Hail Mary response by Fox to a writer strike. I did some calculations; I think the show, in a couple of decades, sold something over one billion dollars worth of commercials. Just dumb luck and timing, combined with repeating the "cops-and robbers" narrative that has been on TV since forever.

Ballroom dancing (or "Dancing with the 'Stars'" here) is nothing more than the latest iteration of the decades-old televised talent show formula, and fits into the low-production-cost formula of reality TV, with the 'talent' working for peanuts. Everyone dances and the male/female coupling subplots are something everyone can relate to and understand. Very few people ride motorcycles compared to the percentage of people who, uh, ride each other. (I think that was pretty delicately phrased.)

There you're seeing snooker and darts. Here, we've seen poker - POKER - on sports networks. Minimal production costs, minimal costs to enter the game, equipment-wise. Production costs border on nothing. The cost of a single top-line KTM Moto3 bike would cover much of the costs of producing a season of snooker broadcasts.

So to market the sport to advertisers and sponsors means you're trying to market a new activity that few people do, costs a fortune to participate in no matter what the rules are, is used as a synonym for "bad" in several cultures and one where one of your three/four star athletes could die at any moment on camera. And there's no sex or romance subplots! Forget the umbrella girls; that's PG stuff in a world where I can get hard-core porn sent to my freakin' phone! (Maybe we need more riders to follow the example of Randy de Puniet, and we can sell that as a reality show.)

And you're trying to do this in a media environment that already is absolutely saturated with sports.

It's a tough, really tough sell. I mean, we just went through the Rossi phenomena. How many outside sponsors did the most famous motorcycle road racer in history actually drag into the sport? It's not just popularity, it's whether an advertiser (or sponsor) wants to reach that particular audience, and whether motorcycle road racing is the most effective way of reaching them on a cost-per-eyeball basis.

Two minor points: My brother is, indeed, an idiot, and golf is indeed the most evil product of Satan.

Internationally, motorcycle racing has proven to be an excellent way of marketing motorcycle-related products when combined with the other rationalization of R&D and engineer training that gets the manufacturers to build bikes and support teams. It seems to me that virtually all of the racing web sites I visit are able to attract only industry-related advertisers. If there was money from other advertising sources, I'm sure someone would have found it.

One does not rule out the other. Luck is always needed, a moment has to arise, and it has to be seized. Clever marketing recognizes the moment, and seizes it.

In motorcycle racing, people get hung up on the 'motorcycle' aspect. Motorcycle racing, like all sports, is ultimately a test of people, one athlete against another. Why is snooker a big success? Because of personalities. Why is poker a big success? Because of personalities. Why is the NFL so huge? Because they successfully market the personalities, the human interest behind the sport.

This is where MotoGP could do a much better job, at promoting the human side of the sport. Push the personalities, exaggerate them if necessary, highlight them. People care about people, the paraphernalia is just there to add some interest. The danger merely adds to the drama, but a promoter needs to be cynical and callous to dare to cash in on it. Those crash highlight reels may be sickening, but they're popular.

Motorcycle racing tends to attract a particularly edgy type of personality. That is ripe for marketing and promoting, if approached the right way. The more staid products may not be a good match, but there are plenty of products which are looking for youth and excitement to add some interest.

>> It seems to me that virtually all of the racing web sites I visit are able to attract only industry-related advertisers. If there was money from other advertising sources, I'm sure someone would have found it.

Racing websites are good at all sorts of things, but attracting advertisers is not one of them. Simply put, none of us have the experience or the inclination to go out and sell to non-industry advertisers. I fear you massively overestimate the competence of the industry.

David, in all sincerity, I do believe that if anyone had the talent to seek out that advertising revenue, or any racing site could attract it, you and your site could. This place is simply the best in the business.

Hey, perhaps you are correct. Maybe marketing the personalities is one way to attract attention, to bring together the audiences and advertisers together. On that level, racers are the equal to any media personality - and better than most. But the general public is so fickle, so unpredictable, that I think it works about as well as hiring a genius rider to hide the flaws of your poor racebike. Sometimes you hit gold. But sometimes you've got to stoop to "Honey Boo Boo" to do so.

Create racing that manufacturers want to participate in. Give them options; if it was MotoGP or nothing, we wouldn't have KTM in the mix. I have no problem with a performance-balanced "spec vs. prototype" class structure.

Quit trying to sell broadcasts of the races. That only enriches Dorna. Spread the basic, non-HD race broadcasts as far and wide as you can. It worked for Metallica.

Obviously, Dorna sells an international audience. One thing it can do is help the smaller advertisers/companies/sponsors get on board for a race, three races, whatever. Don't leave money lying on the ground because it's too small to pick up.

And focus on the inside-the-industry companies, the manufacturers, the aftermarket, the oil companies, the gear companies, everyone who makes money by selling things ONLY to motorcyclists. Let them get a return on their investment first. It's the simplest sell - they are reaching the audience they most need to reach. Motorcycle road racing does a very good job of attracting one group of people - motorcyclists. Sell that audience to the companies that need that specific audience, not companies that have a variety of ways to reach those same people.

I mean, people have lives outside of racing, right? That's what I hear, anyway.

;)

p.s. I'm serious. We need the MotoGP riders to step up and engage in scandalous behavior with supermodels. It's hard work, but it's for the good of the sport.

IMHO
I think Dorna know very well what they have but their fear of loosing control and in turn loosing money, holds them and in turn MotoGP as a whole, back from becoming what it could be.
People who write into this site seem to hate when you compare MotoGP and F1 but the fact is, F1 is making money, huge money, and MotoGP is bleeding out.
Whatever Carmelo Ezpeleta is doing, and this isn't a critique of the man, isn't, by comparison, working.
F1 and Berni are known the world over. If you don't know MotoGP then you have no idea who Carmelo Or Dorna is. If they keep running the show like a small Spanish company / Spanish championship (anything you want Repsol) then we will be talking about the troubles in MotoGP forever or until the end. Or they could partner with companies in countries with motorcycle culture and give up a slice of control and it will grow. Honda vs Dorna, the outcome is a given. Honda vs Dorna / their American, Indian, Japanese, French, British partners would be a different game altogether.

IMHO
I think Dorna know very well what they have but their fear of loosing control and in turn loosing money, holds them and in turn MotoGP as a whole, back from becoming what it could be.
People who write into this site seem to hate when you compare MotoGP and F1 but the fact is, F1 is making money, huge money, and MotoGP is bleeding out.
Whatever Carmelo Ezpeleta is doing, and this isn't a critique of the man, isn't, by comparison, working.
F1 and Berni are known the world over. If you don't know MotoGP then you have no idea who Carmelo Or Dorna is. If they keep running the show like a small Spanish company / Spanish championship (anything you want Repsol) then we will be talking about the troubles in MotoGP forever or until the end. Or they could partner with companies in countries with motorcycle culture and give up a slice of control and it will grow. Honda vs Dorna, the outcome is a given. Honda vs Dorna / their American, Indian, Japanese, French, British partners would be a different game altogether.

Based on the local media (with the numbers from Honda), almost 4.3M in 2011, around 4M in 2012, and 4.8M in 2013. The decline in 2012 is probably because there are stricter rules regarding down payment (that's basically raising the barrier to acquire motorcycle). The large jump in 2013 is probably because the Indonesian government reducing fuel subsidies, thus more people use motorcycle instead of car for daily commute.
Personally, I don't know how much the impact of MotoGP on the sales of motorcycle, but it certainly sparks heated debates between the Honda fans vs the Yamaha fans to the point that you can't have a rational debate (it's mostly trash talk) unless you have a moderator. Especially true on a big news site like detik.com. It's like the comments section from crash.net, only much much much worse.

interesting, but seeing how yamaha pretty much have their 2014 campaign colors set, I could see this as Yamaha running the Movistar livery during selected rounds in a similar fashion they did with JX Nippon Oil(ENEOS) a few years back.

@Motoshrink

Honda pretty much have a lock Red Bull sponsorship. In fact RB seem to be sponsoring Honda riders in both WSBK and MotoGP. As for Monster they are sponsoring the Tech 3 squad and most recent stepped up to be the title sponsor of the Catalunya race.

...is really difficult if the endemic audience is the majority, and the niche is no longer a leader, significantly influential, or otherwise "cool".

The motorcycling sports audience is largely an endemic audience. That means people that love and/or ride bikes, and that's a group that's been increasingly ostracised and marginalised in the mainstream of most of the west for 30+ years.

This is because car ownership is vastly more "productive" for the "economy" so all efforts have gone into promoting the value, prestige, convenience, lifestyle, allure, self assuredness, confidence, freedom, self expression (and many other bullshit qualities) of car "ownership" through various forms of consumer credit.

After housing, cars are the second biggest expenditure of most earners. In large cities where rental housing is the norm, cars are often the largest form of credit a consumer has. This doesn't come about by accident. But it has come at the expense of acceptance of motorcycling and motorcyclists. And our sanity and freedom as the entire human race has plugged into credit provision as a means of self expression.

So the sport of motorcycling is looked on as "... over there, with them..." with all labels of all sorts attached to that, that we're all familiar with.

That's most western countries. We can probably only partially exclude Italy and Spain from this conversation of "the west" due to their continued and enthusiastic embrace of the scooter.

In most of Asia this problem is being confounded by their status as developing countries in which owning a motorbike as primary means of transport is fast becoming a sign of poverty. The same kinds of bullshit associations of wealth and success etc promoted as being how we should represent ourselves through out car choices in the west is now the norm in most of Asia. And it works even better here than it does in the west. Mainly because the car companies have had 30+ years practice refining their message and product in the west before coming here.

In China this problem is massively confounded by most regions banning anything but battery and pedal powered bikes.

Side note, regardless of any other reason for moving from 2 strokes to 4 strokes, it was at least 10 years too late to make a difference to public perceptions of motorbikes as "green" in the west, and irrelevant in the biggest market in the world.

For money to flow to advertising in and around bike racing, bike riding needs to be *cool*, and we're at the ideal point in human history to make this movement possible, due largely to the anti-mood in large swathes of society to the money industries.

Only when bikes in general are *cool* will the audience for MotoGP grow exponentially, as it should, and only then will their be the kind of rewards to association that justify the cost of pure advertising based involvement.

In order for motorbikes as a lifestyle to push back against the swathe of consumer sentiment towards cars and against bikes, their needs to be a concerted effort to prove the efficiency and enjoyment of riding a bike as primary transport, and the associated freedom, speed, and expression available.

Doing that means going up against the providers of consumer credit, mainstream media's addiction to the ad spends of the car industry, and their addiction to much larger forms of credit, and the entire oil industry's desire to see consumers buy more oil, not less, and every government's "obligations" to all of the above.

And this all so racing bikes can have larger banner ads on their sides.

Bikes in the USA have always been a niche thing and will remain so despite their best efforts. It's a safety thing to the average consumer. They see them as speed. Law breaking, machines and nothing the mfr's can do or advertisers to change that stigma. They are more interested in their twatter feed, their Facebook status, and their Apple devices. Bikes just aren't part of the equation and never will be. They remain a niche for us crazies, lunatics, and risk takers. They see us as power rangers in our suits and think you'll "die" if you ride one.

There are many more factors such as inflation, higher costs of everything while salaries have remained stagnant for a decade. People just don't have the discretionary income they did a decade ago.

I don't know what they need to do but is cater to your current customers, focus on service and try to get your customers to buy a 2nd or 3rd bike. Spending money hand over fist to attract new buyers won't provide the ROI despite anything they try. Perhaps when e-bikes are common.

This is a common topic for myself and biking friends.
What could Yamaha build to make me swap my loaded for bear 2006 R1 for a new bike?
For me the question is easy. Make the new 1000 a M1 replica. I'm not talking stickers, I mean a tuned down, less exotic M1. The geometry, bike layout, it's all there. Why am I sitting on nothing but frame over exhaust when every MotoGP rider is sitting over the fuel tank? Why are they still putting their twin exhaust under the tail when the M1 is side mounted?
You did the testing, why not use the results to make the R1 people want?